PCP finance.

CoBo55

CoBo55 wrote: »

PCP and depreciation are intertwined with each other as you found out, something people need to consider if they plan changing again in 3 years. Some cars are a much safer bet than others when it comes to depreciation. And as you found out some dealers are better than others too. As I've said to anyone who's interested, PCP is great as long as you know what you're getting into, never forget the balloon payment!!!

Yes that's true but you pay the calculated projected depreciation + interest to drive for 3 years and xx Kms, it could have gone either way but definitely giving a leaf to a BMW dealer didn't help but you're not paying the full cost of the car + interest unless you pay the balloon.

PCP can be a good way to see how depreciation is working out before you have a car that's half worthless, at year 3 you can decide to cut your losses which is exactly what I did and it's never a bad idea to abandon a sinking ship.

Finance would have ended up the same, depreciation + higher interest.

The best thing to do was get out and I was fully aware of the worst case which was having no value at the end, I said it in my thread also at the time.

However, I am really glad I didn't throw almost 10 K at the leaf to suffer further depreciation, that was much better put into the i3 Rex which gives me much greater driver satisfaction, more range and the Rex, passing charger queues is great fun !

Remember those who think they get good deals are probably the ones paying higher monthly payments, they are paying for the deposit they think they're getting for free , they're not getting anything for free, PCP us usually calculated so that you have something at the end it's just this time depreciation on the leaf was higher than calculated by Nissan.

Remember the winners are always the finance company and the dealer when you buy a car, you're always the looser, you want a car you pay for it simple as.

lcstress2012

I have a fiesta 171 coming to the end of my agreement this year. I’m going to keep the car but need to pay the remaining €7500 balance. Should I get a credit union loan or just refinance with the dealer? Anyone else ever in this situation what did you do ?

Salary Negotiator

lcstress2012 wrote: »

I have a fiesta 171 coming to the end of my agreement this year. I’m going to keep the car but need to pay the remaining €7500 balance. Should I get a credit union loan or just refinance with the dealer? Anyone else ever in this situation what did you do ?

I havent done it, but I'd just go with whichever is cheaper.

My local CU has loans at 7.9%, if the finance company is less than whatever your offers pick them.

Lantus

lcstress2012 wrote: »

I have a fiesta 171 coming to the end of my agreement this year. I’m going to keep the car but need to pay the remaining €7500 balance. Should I get a credit union loan or just refinance with the dealer? Anyone else ever in this situation what did you do ?

You can do either. Get quotes from all and compare. Some cus offer a 5.8% rate on pcp balloon and over 5 years.

You can also pay off a lump sum before or after you start repayments on finance. Usually its the full outstanding amount after your paying and at very little cost.

micks_address

Hi folks,
My pcp is up next year. I've a high spec skoda Octavia auto, Diesel, 150bhp, sportline etc. 172 d, I suspect I won't have a huge amount of equity to play with come next year when changing. After the three years lump sum will be about 12.7k.. the car new cost 35.5k, 0 percent finance.

I'm half wondering if handing back the car would be a crazy option? If I'm offered 3k equity.. to buy a similar priced car I'll probably have to put 5 or 6k into the deal myself to buy same again. I've already got a few prices and have been offered as low as 15k this year.. 53k km on the car.. I got 16k for my 3 year old Civic when buying the Octavia.. maybe I'm underestimating the trade in value I'll be offered next year. If I'm offered 18k might be workable but is that realistic?

Other option is to finance the balance and keep the car. Very happy with it so don't want to change for something and have to pay a lot to stay in similar for the sake of a new car..

Cheers,
Mick

Casati

micks_address wrote: »

Hi folks,
My pcp is up next year. I've a high spec skoda Octavia auto, Diesel, 150bhp, sportline etc. 172 d, I suspect I won't have a huge amount of equity to play with come next year when changing. After the three years lump sum will be about 12.7k.. the car new cost 35.5k, 0 percent finance.

I'm half wondering if handing back the car would be a crazy option? If I'm offered 3k equity.. to buy a similar priced car I'll probably have to put 5 or 6k into the deal myself to buy same again. I've already got a few prices and have been offered as low as 15k this year.. 53k km on the car.. I got 16k for my 3 year old Civic when buying the Octavia.. maybe I'm underestimating the trade in value I'll be offered next year. If I'm offered 18k might be workable but is that realistic?

Other option is to finance the balance and keep the car. Very happy with it so don't want to change for something and have to pay a lot to stay in similar for the sake of a new car..

Cheers,
Mick

Sounds like a lovely car you have, you’d be mad to get rid of it next year especially when your mileage is so small. Enjoy it for another two or three years

Lantus

Handing back car only makes sense if you won't drive again or the economics of the car market are broken.

In your case just pay of the lump sum. You've a nice car, low mileage. Why get rid?

mickdw

You will be throwing away money if you hand it back. Finance the remainder at best rate possible and keep it as long as you like.
Remember, you don't have to return to same dealer or same brand. You can go anywhere. They will give you difference between amount owed and trade in offer to go toward new car.

Id imagine you should do ok on trading in a low mile good spec Octavia.

EndaHonesty

micks_address wrote: »

Hi folks,
My pcp is up next year. I've a high spec skoda Octavia auto, Diesel, 150bhp, sportline etc. 172 d, I suspect I won't have a huge amount of equity to play with come next year when changing. After the three years lump sum will be about 12.7k.. the car new cost 35.5k, 0 percent finance.

I'm half wondering if handing back the car would be a crazy option? If I'm offered 3k equity.. to buy a similar priced car I'll probably have to put 5 or 6k into the deal myself to buy same again. I've already got a few prices and have been offered as low as 15k this year.. 53k km on the car.. I got 16k for my 3 year old Civic when buying the Octavia.. maybe I'm underestimating the trade in value I'll be offered next year. If I'm offered 18k might be workable but is that realistic?

Other option is to finance the balance and keep the car. Very happy with it so don't want to change for something and have to pay a lot to stay in similar for the sake of a new car..

Cheers,
Mick

I rolled my PCP over from a 152 Octavia VRS to a 182 Superb and it worked out quite well for me.

But, I had started looking to change in 172 and was given terrible trade-in offers and started to worry.

When it came to the end of the PCP the figures seemed to suddenly change and I was offered a fairly good deal.

So my advice is to; not worry, see out the PCP and see what offers are available then.

You'll have more equity than you think and the dealers will be happy to offer you an attractive deal to get you into a new car....

ELM327

At the end of the day the whole point of PCP is to get you to buy a new car every three years. They will give you a good deal at teh end of the pcp term

L-M

Depreciation is worst in year one, then year two and finally year three. Usually (Especially with High spec stuff, ie you’ve a 2.0 DSG versus probably every other 1.6 Ambition) you’re better off waiting at least 2 years, and the closer you get to 3 the better your equity should get.

You should keep in touch with your dealer nearly every month or two, keep them in the loop you’re looking to change Incase a special offer/0 percent finance etc comes out.

Also as stated you’re not tied to Skoda, (Although probably will get the best deal from them) but you can shop around

micks_address

Cheers folks,

Yeah i was hoping to look at a 150 bhp petrol auto sportline superb next summer and see how it goes. Obviously the 0% helps massively in terms of current payment.. year 1 or 2 changes while on pcp seem near impossible.. i priced a few options last year and this and it seems like its just not viable..

trickybicky

Wondering if anyone can give me a view on this.

I have a 171 VW Tiguan Highline 2.0 TDI Manual with 25,000km
PCP deal is up in Jan 2020
Balloon payment is €15,000
Trade in offered €23,000 – is this a good offer?

I am looking to move to a new car on PCP.
New Car:
201 VW Tiguan RLine 1.5TSI DSG
Price of Car (with extras) €43,500
0% Finance
Dealer contribution €1,500

They are offering me 23,000 for my current car which leaves equity of 8k.

They are saying the cost price for the car in January is the current price + inflation of around 1% - is this typically what they do? He said he has one ordered now which I could take at a lower price but it’s a 192

They said the cost also includes an insurance policy to guarantee the value of the car if written off/robbed and also fabric and scratch protection cover that they insist I have to take out. Is this right? The costs of the policies are around €750. When I challenged him on this he said it’s the reason they offer a dealer contribution to go against this.

Almost 20% deposit funded by equity in your current car......... sounds like PCP at it's best if you were happy paying €xxx/month all along after whatever deposit you ponied up for the existing yoke.

Cyrus

just be careful that the tiguan wont be a current model when you come out of your new deal, if thats the case you could get clobbered on that trade in.

bazz26

And there is a facelift Tiguan model due in early 2020 similar to the recent Passat.

Casati

trickybicky wrote: »

Wondering if anyone can give me a view on this.

I have a 171 VW Tiguan Highline 2.0 TDI Manual with 25,000km
PCP deal is up in Jan 2020
Balloon payment is €15,000
Trade in offered €23,000 – is this a good offer?

I am looking to move to a new car on PCP.
New Car:
201 VW Tiguan RLine 1.5TSI DSG
Price of Car (with extras) €43,500
0% Finance
Dealer contribution €1,500

They are offering me 23,000 for my current car which leaves equity of 8k.

They are saying the cost price for the car in January is the current price + inflation of around 1% - is this typically what they do? He said he has one ordered now which I could take at a lower price but it’s a 192

They said the cost also includes an insurance policy to guarantee the value of the car if written off/robbed and also fabric and scratch protection cover that they insist I have to take out. Is this right? The costs of the policies are around €750. When I challenged him on this he said it’s the reason they offer a dealer contribution to go against this.

Seems like a good deal bar that 750 quid policy which is a waste of money. Take that out and you will have almost 10 deposit in the new car. As others have said a facelift is due but probably nothing major

trickybicky

Thanks for the feedback.

I was googling the Tiguan Facelift and from what I can tell it will be 2021 and from the pictures no major changes. The new Tiguan looks like it will be out in 2022 so would take a hit in 2023 if I change again.

Not much I can really do about it unless I look at a different car but I am happy with the current Tiguan.

In relation to trade in price of €23k, from looking at their website they are selling the same 171 cars for €32k - seems a big drop to €23k but he explained this by saying he has to give a 3 yr warranty, service car, clean it etc.

I will challenge him again on the €750 policy - doesn't make sense to me that they can force this on you, felt like an upsell to me.

Always walk away from these sales guys feeling like I have been robbed!

bazz26

It makes no sense to facelift a car and then replace it entirely with a new model a year later. The current Tiguan has been around since 2016 so will get a facelift early next year to keep it fresh until an all new model arrives in 2022/2023. If the facelift doesn't bother you then the when the facelift arrives doesn't matter but it is true that it either pre facelift or facelift will be the old model when your new PCP deal finishes in 2023. This will have an impact on your equity so should be taken into account.

micks_address

If you don't mind me asking... are you having to put extra cash into the deal to keep your monthly payment same as what you are on?

trickybicky wrote: »

Thanks for the feedback.

I was googling the Tiguan Facelift and from what I can tell it will be 2021 and from the pictures no major changes. The new Tiguan looks like it will be out in 2022 so would take a hit in 2023 if I change again.

Not much I can really do about it unless I look at a different car but I am happy with the current Tiguan.

In relation to trade in price of €23k, from looking at their website they are selling the same 171 cars for €32k - seems a big drop to €23k but he explained this by saying he has to give a 3 yr warranty, service car, clean it etc.

I will challenge him again on the €750 policy - doesn't make sense to me that they can force this on you, felt like an upsell to me.

Always walk away from these sales guys feeling like I have been robbed!

trickybicky

micks_address wrote: »

If you don't mind me asking... are you having to put extra cash into the deal to keep your monthly payment same as what you are on?

Repayments will be less this time. My last deal was a 1.9% PCP rate and I didn't have as large a deposit the last time.

Lantus

I agree on insurance. Is it for 3 years or just 1?

They pull the same trick on servicing. I challenged this as was more expensive than their buy 3 get 1 free offer and was offered a 4th service free.

Don't like the you must buy it sell.

Likeabossboss

Got a good deal in the states on a new 2ltr Civic, 1240 up front and 225 a month with 12000 miles a year for three years. Do feck all mileage here so think I got a good deal anyway

ShadowHearth

Likeabossboss wrote: »

Got a good deal in the states on a new 2ltr Civic, 1240 up front and 225 a month with 12000 miles a year for three years. Do feck all mileage here so think I got a good deal anyway

I presume it's leasing? Very popular there, but it's non existent for private sector here.

CoBo55

Likeabossboss wrote: »

Got a good deal in the states on a new 2ltr Civic, 1240 up front and 225 a month with 12000 miles a year for three years. Do feck all mileage here so think I got a good deal anyway

What happens when the 3 years are finished? Do you have the option to buy, renew etc?

Likeabossboss

Yea it’s three year lease, have the option to buy at the end, think it’s 10750 but think I’ll just go again and get a new one to be honest.

Suits me down to the ground paying that much a month and the up front fee.

If it was paying the 7 or 8K back in Ireland Up front I wouldn’t bother with leasing

L-M

trickybicky wrote: »

Wondering if anyone can give me a view on this.

I have a 171 VW Tiguan Highline 2.0 TDI Manual with 25,000km
PCP deal is up in Jan 2020
Balloon payment is €15,000
Trade in offered €23,000 – is this a good offer?

I am looking to move to a new car on PCP.
New Car:
201 VW Tiguan RLine 1.5TSI DSG
Price of Car (with extras) €43,500
0% Finance
Dealer contribution €1,500

They are offering me 23,000 for my current car which leaves equity of 8k.

They are saying the cost price for the car in January is the current price + inflation of around 1% - is this typically what they do? He said he has one ordered now which I could take at a lower price but it’s a 192

They said the cost also includes an insurance policy to guarantee the value of the car if written off/robbed and also fabric and scratch protection cover that they insist I have to take out. Is this right? The costs of the policies are around €750. When I challenged him on this he said it’s the reason they offer a dealer contribution to go against this.

23 sounds very weak with that mileage also 750 for that insurance product is a pure rob.

Price around.

skodacb

micks_address wrote: »

Hi folks,
My pcp is up next year. I've a high spec skoda Octavia auto, Diesel, 150bhp, sportline etc. 172 d, I suspect I won't have a huge amount of equity to play with come next year when changing. After the three years lump sum will be about 12.7k.. the car new cost 35.5k, 0 percent finance.

I'm half wondering if handing back the car would be a crazy option? If I'm offered 3k equity.. to buy a similar priced car I'll probably have to put 5 or 6k into the deal myself to buy same again. I've already got a few prices and have been offered as low as 15k this year.. 53k km on the car.. I got 16k for my 3 year old Civic when buying the Octavia.. maybe I'm underestimating the trade in value I'll be offered next year. If I'm offered 18k might be workable but is that realistic?

Other option is to finance the balance and keep the car. Very happy with it so don't want to change for something and have to pay a lot to stay in similar for the sake of a new car..

Cheers,
Mick

I'd keep it personally, by the time your PCP is up the new model Octavia will be on Irish shores, which will probably lessen your cars value.

I was thinking long and hard about my 171 Octavia(vRS) too as its PCP is drawing to a close soon, which are going for nearly €25,000 used, I'd be doing very well to get €7k equity after the balloon payment of €13,400.

I've decided to go with the CU and be done with it. I was inkling towards a Superb Sportsline but the RS has all I need in it.

Payments will work out at about €260/month over a 5 year loan compared to the €430 I'm currently spending per month, there's only 22,000 miles on the clock, I think I'd be foolish to hand it back to the dealer.

L-M

skodacb wrote: »

I'd keep it personally, by the time your PCP is up the new model Octavia will be on Irish shores, which will probably lessen your cars value.

I was thinking long and hard about my 171 Octavia(vRS) too as its PCP is drawing to a close soon, which are going for nearly €25,000 used, I'd be doing very well to get €7k equity after the balloon payment of €13,400.

I've decided to go with the CU and be done with it. I was inkling towards a Superb Sportsline but the RS has all I need in it.

Payments will work out at about €260/month over a 5 year loan compared to the €430 I'm currently spending per month, there's only 22,000 miles on the clock, I think I'd be foolish to hand it back to the dealer.

You know Skoda will offer a far better rate than the CU to refinance it and without a deposit. Albeit over 3 more years but you’d be far better off than going with the CU, would be a huge saving. Putting it over a further 5 years is a terrible idea

Lantus

trickybicky wrote: »

Thanks for the feedback.

I was googling the Tiguan Facelift and from what I can tell it will be 2021 and from the pictures no major changes. The new Tiguan looks like it will be out in 2022 so would take a hit in 2023 if I change again.

Not much I can really do about it unless I look at a different car but I am happy with the current Tiguan.

In relation to trade in price of €23k, from looking at their website they are selling the same 171 cars for €32k - seems a big drop to €23k but he explained this by saying he has to give a 3 yr warranty, service car, clean it etc.

I will challenge him again on the €750 policy - doesn't make sense to me that they can force this on you, felt like an upsell to me.

Always walk away from these sales guys feeling like I have been robbed!

The 2016 is a better guide on price as the dealer will be selling your car 3 years old come next year. A good hl model is 27k. Even taking a mid point between your 32 and this 29.5k.

So 6.5k profit by dealer if you get 23k which doesn't seem so bad. They have kids to feed as well....

hooch-85

Limerick man wrote: »

You know Skoda will offer a far better rate than the CU to refinance it and without a deposit. Albeit over 3 more years but you’d be far better off than going with the CU, would be a huge saving. Putting it over a further 5 years is a terrible idea

Tend to agree, I bought a 3 year old car last year on a 5 year HP and I regret not going for a shorter term really, I probably could have afforded it. Paying for a car over 8 years seems like madness but you'll be in the same position really as me, we'll both have an 8 year old car.

Likeabossboss

Likeabossboss wrote: »

Got a good deal in the states on a new 2ltr Civic, 1240 up front and 225 a month with 12000 miles a year for three years. Do feck all mileage here so think I got a good deal anyway

Likeabossboss wrote: »

Yea it’s three year lease, have the option to buy at the end, think it’s 10750 but think I’ll just go again and get a new one to be honest............

Interesting how they structure the first 3 years at 45% of the total and the balloon/buy price is the 55%. Great how it's effectively pay as you use.
And they're still making money on it too of course.
Shows how cheap cars actually are in some places.
A 2.0 Civic is a fine car for that money.

Lantus

Augeo wrote: »

Interesting how they structure the first 3 years at 45% of the total and the balloon/buy price is the 55%. Great how it's effectively pay as you use.
And they're still making money on it too of course.
Shows how cheap cars actually are in some places.
A 2.0 Civic is a fine car for that money.

Generally better to pay off more in first 3 years. It protects against car inflation, falling values and better ensures equity left in car. Vw is 50 to 55 last time I checked. Leaf is much more. Brands like BMW which paid off less in first 3 years ran into trouble with returning customers having zero equity. Not a good position to be in as a customer.

Cyrus

Lantus wrote: »

Augeo wrote: »

Interesting how they structure the first 3 years at 45% of the total and the balloon/buy price is the 55%. Great how it's effectively pay as you use.
And they're still making money on it too of course.
Shows how cheap cars actually are in some places.
A 2.0 Civic is a fine car for that money.[/quote

Generally better to pay off more in first 3 years. It protects against car inflation, falling values and better ensures equity left in car. Vw is 50 to 55 last time I checked. Leaf is much more. Brands like BMW which paid off less in first 3 years ran into trouble with returning customers having zero equity. Not a good position to be in as a customer.

the american example given is basically a lease though, you pay the upfront and pay the monthly and buy at the end or hand back, theres no equity.

sillysocks

hooch-85 wrote: »

Tend to agree, I bought a 3 year old car last year on a 5 year HP and I regret not going for a shorter term really, I probably could have afforded it. Paying for a car over 8 years seems like madness but you'll be in the same position really as me, we'll both have an 8 year old car.

Not necessarily, we refinanced for 5 years at the end of the pcp (pcp finance company did offer 5 when we asked). We wanted to reduce payments as we needed to change our second car and it just gave us a bit more wriggle room. We may pay off early, and will probably change the car beforethe 8 years are up anyway.
Just because you finance for 8 doesn’t mean you have to keep it for 8.

Lantus

Lantus wrote: »

..........

Generally better to pay off more in first 3 years. It protects against car inflation, falling values and better ensures equity left in car. Vw is 50 to 55 last time I checked. Leaf is much more. Brands like BMW which paid off less in first 3 years ran into trouble with returning customers having zero equity. Not a good position to be in as a customer.

It's a grand position if you just want a new car on a pay as you use basis, agreed up front. 3 years use for 45% of the new price.

Equity is grand conceptually but not if you want to just lease the thing and the deposit is tiny.

Cyrus wrote: »

the american example given is basically a lease though, you pay the upfront and pay the monthly and buy at the end or hand back, theres no equity.

I know

Augeo wrote: »

............. Great how it's effectively pay as you use. ...........

hooch-85

sillysocks wrote: »

Not necessarily, we refinanced for 5 years at the end of the pcp (pcp finance company did offer 5 when we asked). We wanted to reduce payments as we needed to change our second car and it just gave us a bit more wriggle room. We may pay off early, and will probably change the car beforethe 8 years are up anyway.
Just because you finance for 8 doesn’t mean you have to keep it for 8.

That's true I know, it all depends on everyone's circumstances. In my own i will probably keep to end of term and drive it until it stops, my wife has a 181 car on PCP which we will change in 2021 alright.

Cyrus

Augeo wrote: »

I know

sorry the quote was messed up i was responding to lantus

carsfan2

@Cyrus,
Did you go for the pcp deal you were thinking about recently on your own two year old?
Seemed like it was a fair deal if I remember correctly?

Cyrus

carsfan2 wrote: »

@Cyrus,
Did you go for the pcp deal you were thinking about recently on your own two year old?
Seemed like it was a fair deal if I remember correctly?

yes it was but ultimately decided against it, want something bigger so ill see what a one year old GLE will run me next year, the new model is lovely

lcstress2012

I currently have a 171D Ford Fiesta Titanium paying €300 per month with a GMFV of €7400. Went to ford dealer today about January car and getting Fiesta ST Line for €290 per month! Good deal if you ask me!

bazz26

That depends on the entire cost of the new car rather than just the headline monthly repayments. How much equity do you have in the 171 Fiesta, did you have to put a cash contribution up front, what is the interest rate and what is the GMFV on the new car?

CoBo55

bazz26 wrote: »

That depends on the entire cost of the new car rather than just the headline monthly repayments. How much equity do you have in the 171 Fiesta, did you have to put a cash contribution up front, what is the interest rate and what is the GMFV on the new car?

Most importantly it's a D... not one of those country letters..

DaveyDave

Hard to know as there's no pricing for the Fiesta on Ford's website. What's the price of the car? How much was offered for your car/how much equity did you get?

CoBo55

CoBo55 wrote: »

Most importantly it's a D... not one of those country letters..

Think I'd rather a country reg diesel that's been driven than a town/city car that hardly warms up.

L-M

CoBo55 wrote: »

Most importantly it's a D... not one of those country letters..

That’s the most Dublin thing I’ve ever heard anyway say. Considering half the “D” stuff is ex rental, you might get more than you bargained for, lol.

johnire

I’ve a PCP loan on my car which I’m planning to change in January.
If things work out I’m expecting a lump sum of money possibly as early as February. In an ideal situation I’d like just to continue on the PCP arrangement until I get that money and then clear in full the balance outstanding. Is it that simple though? Is it possible to clear a PCP early(and by early I’m talking about maybe a month into a 3 year plan!) and even if it is are there penalties for doing so?
Thanks

L-M

johnire wrote: »

I’ve a PCP loan on my car which I’m planning to change in January.
If things work out I’m expecting a lump sum of money possibly as early as February. In an ideal situation I’d like just to continue on the PCP arrangement until I get that money and then clear in full the balance outstanding. Is it that simple though? Is it possible to clear a PCP early(and by early I’m talking about maybe a month into a 3 year plan!) and even if it is are there penalties for doing so?
Thanks

Which bank?

There are fees for clearing, if there’s interest.

johnire

It’s Bank of Ireland.

Limerick man wrote: »

Which bank?

There are fees for clearing, if there’s interest.

L-M

johnire wrote: »

It’s Bank of Ireland.

Probably get screwed so. Depends on when you pick up your new car but you’ll end up paying completion fees on the current, starting fees on the new and the completion fees on the new plus a few months interest (which will be a lot, could end up paying back a good bit more than you borrowed)